A critical analysis of government grants accounting approaches. Part 2

Subject. This article discusses the theoretical, historical and methodological particularities of State assistance accounting, including the socio-economic relations that have developed between companies, developers of accounting standards and the academic community. Objectives. The article aims to critically characterize approaches to State assistance accounting, show the theoretical inconsistency of the International Financial Reporting Standard (IAS) 20 – Accounting for Government Grants and Disclosure of Government Assistance, and choose the most appropriate method that corresponds to the guideline scientific concepts. Methods. The research is speculative. For the study, I used the dialectical method of scientific knowledge, the method of collecting theoretical and regulatory information, the method of formalization, as well as analysis, synthesis, observation, and comparison. Results. The scientific novelty lies in the generalization and characterization of five approaches to the accounting for State assistance. The article substantiates that State assistance should be recognized as part of liabilities if and only if there are current and/or future conditions that impose obligations on the organization to receive State assistance, otherwise it should be recognized exclusively as part of equity. It is found that the background of these standards in the area of accounting for State assistance is the result of lobbying companies to increase net income. Conclusions and Relevance. The results of the study call into question the acceptability of the theoretical foundation of IAS 20. The results of the study are primarily intended for the accounting scientific community and developers of accounting standards.